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      Question

      A sum of ₹12,000 is invested for 3 years at a certain

      rate of simple interest. If the same sum was invested at the same rate for 2 years under compound interest (compounded annually), it would earn ₹240 more. Find the rate of interest per annum.
      A 5% Correct Answer Incorrect Answer
      B 6% Correct Answer Incorrect Answer
      C 8% Correct Answer Incorrect Answer
      D 10% Correct Answer Incorrect Answer
      E 12% Correct Answer Incorrect Answer

      Solution

      Let the rate of interest be R%. Simple interest for 3 years = (12,000 × R × 3) ÷ 100 = 360R Compound interest for 2 years = 12,000 × [(1 + R/100)^2 - 1] The difference is ₹240: 12,000 × [(1 + R/100)^2 - 1] - 360R = ₹240 Simplify and solve for R. Approximating, R ≈ 10%. Correct Option: d

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